Mubarak, Egypt Clear Winners as Conflict Ends : Gulf region: Cairo, after a key role in the war, enjoys the confidence of the United States and its Arab allies.

While the world focuses on the final outcome of the Persian Gulf War and the future of Iraq and Saddam Hussein, Egypt and its burly, stolid President Hosni Mubarak are emerging from the confusion and anxiety of battle as real winners in the region.

“Of course Egypt and Mubarak are coming out on top,” said a Western diplomat. “With the fighting over and the bargaining beginning over who controls the power in the Arab and Muslim worlds, it’s going to be Egypt in the end.”

There is little to dispute this, at least on the surface. Egypt won the confidence and gratitude of the United States and its Arab allies when it condemned the Iraqi invasion of Kuwait early and often.

Mubarak ingratiated himself further when he sent nearly 40,000 combat troops to Saudi Arabia, the largest Arab contingent and the third-largest force in the whole of the American-led coalition.

Egypt, by the account of American officials, enjoys near total U.S. confidence, and by promising to take a major part in a postwar regional security arrangement, Cairo has earned the gratitude and several billions of dollars in economic aid from weaker Arab states afraid of an Iraqi resurrection or power-grabbing by Syria and Iran.

There is an additional sense of what some Egyptian officials privately call a delicious irony in the attitude of the Gulf states, many of which infuriated Cairo before the war by quietly financing Egyptian Islamic fundamentalist movements seen as opposing Mubarak.

Now those payments have stopped, Egyptian officials say. “This crisis leaves the conclusion that a strong Egypt is inevitable--for the Americans, for the Arabs, even for the Israelis--because a strong Egypt means peace,” one of the officials said. “So, it’s a world of irony, this Middle East.”

According to an Arab ambassador serving here, “There are those who say Mubarak walked a tightrope and all that (by siding so completely with the West), but the fact is, once the West and most of the important countries in the region opted to take on Saddam Hussein, Egypt had to come out ahead.

“Egypt is the largest Arab country,” he explained. “It has a history of leadership in the Arab world, and it traditionally influences the course of events. When it was clear that Iraq was isolated, it was only natural for Egypt to rise to the top. Mubarak could have lost only by joining Iraq, but that would have been stupid, and he’s not stupid. Mubarak picked the right side from the outset and he stuck with it.”

If this diplomat’s optimistic view proves to be correct, and right now there is little meaningful dissent even among Mubarak’s domestic enemies, it reflects a complete turnabout in the fortunes of this dizzyingly diverse country and the president many people call “cow eyes.”

It wasn’t that long ago that Egypt was an Arab World leper, kicked out of the Arab League and isolated in the region for signing a 1979 peace treaty with Israel and exchanging ambassadors with a state seen by most of the Arab and Muslim nations as a satanic device.

Although the peace agreement with Israel was signed by the late President Anwar Sadat, Mubarak was equally condemned for continuing his assassinated predecessor’s policies.

And although Egypt gained a badly needed respite after four exhausting and losing wars with the Jewish state, detractors liked to point out that Egypt’s economy staggered, its foreign debt exploded and the Sadat-Mubarak promise that Cairo could lead Israel into a just settlement of the Palestinian issue turned to sand.

Furthermore, to control a growing radical Muslim movement and noisy political opposition, Mubarak repressed dissent to such a degree that human-rights groups condemned his heavy handed tactics, a policy still in effect if the words and actions of Interior Minister Mohammed Abdel-Halim Moussa are an indication.

“We keep a very close eye on them,” he said in a brief interview, smiling through the smoke of his cigar. “We make certain they present no threat.”

Over the next four days after the interview, Moussa’s forces used rubber bullets, tear gas, clubs and arrests to quash a small student demonstration protesting the war and brutal police tactics.

If this approach is seen as “sometimes a little too heavy-handed” by one friendly Western diplomat, it hasn’t given him any pause as he says that Egypt is “now our most important ally in the Arab world.”

But if Cairo’s vault back into the leadership of the region is linked to the Gulf War, there were signs beforehand that the Western diplomat’s belief in a predestined Egyptian pre-eminence was being borne out.

Mubarak reconciled with the Palestine Liberation Organization in 1983 and restored diplomatic relations with Jordan the next year. By 1990, most important Arab states had resumed official contacts with Cairo including, ironically, Iraq. Egypt was readmitted to the Arab League, which moved its headquarters back to Cairo.

“We already were a power and an influence (in the region),” said an Egyptian government official. “What Saddam did was strengthen us by removing himself as a rival.”

This elevated view of Mubarak and his policies is widely backed in Egypt in spite of--or perhaps because of--the tough, even repressive approach to domestic opponents that influential newspaper columnist Mohammed Seid Ahmed says makes “Egypt no democracy.”

Spot surveys by Saed Eddin Ibrahim, a sociologist at the American University of Cairo, showed Mubarak with overwhelming public support before the Gulf crisis developed last August, backing that grew when fighting broke out.

“In January he had 83%-87%,” Ibrahim said in an interview. “That overwhelming support has eroded in the last month because some people don’t like the presence of foreign troops in the region, but it is still at 75%.”

Much of the credit for the general popular support comes from what one foreign military expert who has served in Egypt for more than a decade says “is a great respect for the man at the top. Egyptians respect and accept authority.”

“There hasn’t been a revolution here since 1952,” he said, “and even then thousands of people, including some of the officers who led the revolt, went to the docks and cried when (deposed King) Farouk left for exile.”

When Iraq invaded Kuwait, Mubarak’s immediate condemnation was widely supported, even by many of his internal foes, including the Muslim Brotherhood, a group of religious activists founded in 1928 and seen by the government as its most serious challenge.

“Egyptians don’t like Iraq,” said a European diplomat. “Egyptian workers were mistreated in Iraq, and when Saddam invaded Kuwait, the Egyptians there were thrown out. When the workers returned, their stories of mistreatment outraged people here.”

According to Ibrahim, a widely respected authority on Islamic fundamentalism, the Muslim Brotherhood’s only dissent is over the question of foreign troops. “But even they recognize that Hussein’s actions brought on the presence of the outsiders. They blame Iraq for creating the situation.”

There was additional resentment over the loss of perhaps $1.5 billion a year in remittances from the 400,000 Egyptians workers in Iraq and Kuwait as well as a calamitous fall in tourist revenue here.

But even in economics, Mubarak’s cheerleaders say he has, in the words of another Western diplomat, “handled the Kuwaiti situation very well.”

The United States, for example, has written off Egypt’s $6.7-billion military debt, and Gulf countries have forgiven an additional $7 billion.

Saudi Arabia has promised large cash relief, as have Japan and others. Furthermore, Egypt, which produces 400,000 barrels of oil a day, stands to earn $770 million a year in additional income at current prices.

In exchange for promising a large troop contingent for a postwar regional peacekeeping force, Egypt also will get a large share of an expected $15-billion economic development program, and Mubarak is insisting that Egyptian companies get a share of the contracts for rebuilding Kuwait.

“All of a sudden, you start seeing how some say the Egyptians will come out on top of this,” said one Western economist.

Yet among the rose petals on Egypt’s path are some cinders.

“I question whether Mubarak is a big winner,” said columnist Seid Ahmed of the government-owned Al Ahram newspaper.

“The allied victory doesn’t address the frustrations of the Palestinians. . . . And (Egypt’s) close position to the United States means it can’t play its traditional role as a mediator in the region,” Seid Ahmed said in an interview. “Mubarak has forfeited that role to Iran, and that’s not good.”

Such opposition to Mubarak’s Iraq policy is dismissed by a European diplomat as the whimperings of Cairo’s “chattering classes” of ineffectual intellectuals.

But he and other Mubarak admirers see trouble ahead in the government’s traditional inability or refusal to come to grips with the poverty of the streets.

Although given credit for taking the edge off popular resentment over increasing poverty by holding down prices and subsidizing such basic goods as fuel and food, Mubarak is criticized even by friends for using stopgap measures.

“The trickle-down theory here means the trickle dries out at the top,” a Western diplomat said.